Of course, Square and Braintree have fundamentally different business models, but as they both evolve they find themselves competing head to head. While Square has focused on the small business owner looking to accept credit card payments, Braintree is strictly an e-commerce and m-commerce company handling payments for some of the best-known startups in the business, including AirBnB, Uber, OpenTable, LivingSocial, GitHub and Fab.com.

The model is much more similar to PayPal or Chase Paymentech, which dominate the low-volume and the high-volume end of the e-commerce business respectively. Braintree, however, is trying to bridge the gap between the two. By providing advanced features such as m-commerce, foreign currency processing and high-volume scaling, Ready said Braintree is able to support companies from their birth as tiny startups to their emergence as huge international e-tailers.

Braintree CEO Bill Ready

Braintree began processing foreign currency payments shortly after its launch in 2008, and that’s been one of the key drivers of its growth. AirBnB, which signed up with Braintree shortly after it launched, was able to expand quickly overseas. That allowed AirBnB to head off potential competition from foreign companies emulating its business model, Ready said.

“That’s one of the big reasons startups want to work with us,” Ready told GigaOM. “Startups need to go international much more quickly than they used to. But in order to accept international payments you used to have to go to [a provider] that required you to have hundreds of millions in accounts.”

Until last year, though, Braintree only processed transactions for U.S.-based merchants. In October, after raising a $35 million Series B round, it went overseas, extending payment support to online merchants in Canada and most European countries. It expanded to Australia in November, and Ready said it plans to launch in Switzerland, Norway and Turkey this week, completing its European footprint.

Ready said that international push as allowed it land key overseas customers like Finland’s Rovio, the creator of Angry Birds. In just six months, Braintree has grown that business to the point its processing $2 billion in annualized transactions on foreign shores, Ready said.

Braintree has raised a total of $70 million and is primarily backed by NEA and Accel Partners. Ready said it has 150 employees, most of which are in its Chicago HQ and in two satellite offices in San Francisco and New York City.

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Airtel Africa, part of the India-based Bharti Airtel group, will deploy tens of thousands of carrier-grade access points in high-traffic areas throughout its pan-continental network, according to a source close to the deal who asked not to be named because details have not been officially released. Airtel has started building the network in Niger, but it plans to quickly expand it to the 16 other African countries in its footprint. Depending on how successful the rollout is and how much the network is used, Airtel could expand the project to encompass more than 100,000 nodes, our source said.

A Ruckus Wireless Wi-Fi hotspot/small cell

Ruckus Wireless will supply its indoor and outdoor high-capacity access points, while Alcatel-Lucent will supply its service and aggregation router and act as the system integrator on the project. We reached out to Airtel, Ruckus and Alcatel-Lucent. Alcatel-Lucent confirmed it is building a backbone data transport and backhaul network for Airtel, but a spokesman said the company would not comment on any Wi-Fi plans. Ruckus told us they had no comment, and we have not heard back from Airtel.

While Wi-Fi is being used in countries like the U.S. to supplement high-speed 3G and LTE networks, in Africa 3G connections are few and far between and 4G services are virtually nonexistent. According to Ericsson’s most recent Market Report, 85 percent of the subscribers in the Africa and Middle East regions are on 2G networks. Africa’s penetration of smartphones is low compared to more developed regions, but it’s expected to grow quickly as more vendors produce cheaper and cheaper Wi-Fi-equipped Android smartphones.

Our source tells us that Airtel is using Wi-Fi as a 3G/4G replacement, putting up dense clusters of access points in hotels, airports, shopping districts and heavily trafficked outdoor locations. It’s much more inexpensive to use Wi-Fi as a mobile data technology. Even though it can’t provide the coverage of a wide-area cellular network, Airtel can use it surgically, delivering capacity to areas where it will be used the most.

The deal is a big one for Ruckus, which recently went public, even though the rollout doesn’t yet approach the scope of its massive Wi-Fi contract with Japan’s KDDI. For Alcatel-Lucent, the deal is an opportunity to help build an alternate wireless network for one of Africa’s largest carriers using its core infrastructure. Alcatel-Lucent has its own Wi-Fi product, but it’s meant to be deployed in conjunction with its own lightRadio 3G and 4G infrastructure. Airtel uses Nokia Siemens Networks and Huawei for its cellular systems, but the deal could give Alcatel-Lucent a leg up when the next round of network construction begins.

Apart from Niger here are the other countries Airtel will launch Wi-Fi in: Burkina Faso, Chad, the Democratic Republic of the Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Nigeria, the Republic of the Congo, Rwanda, the Seychelles, Sierra Leone, Tanzania, Uganda and Zambia.

Featured image courtesy of Shutterstock user Anton Balazh

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At first glance Nexmo isn’t exactly what you’d think of as a next-generation technology company. It traffics in old-school telecom signaling protocols like SS7, but in doing so it’s able to link the app-centric world of IP communications with mobile networks — no matter how old — around the world. Like its competitor Twilio, Nexmo can give developers access to services like SMS that would normally be locked inside carriers’ labyrinth networks, and through its network of relationships with the carriers it can streamline the transaction process.

Based jointly in San Francisco and London, Nexmo says its current SMS API can reach 5 billion mobile devices or connections around the world. That’s only about 900 million short of the total number of non-machine-to-machine subscriptions in the world, according to the GSM Association.

The company said its next step is to expand its catalog of telco APIs, but it didn’t give any specific examples. You can bet that VoIP is probably in the mix though. Being able to establish an in-app VoIP call that can connect to any mobile phone number in the world would be a very attractive service to customers like AirBnB.

Correction: An earlier version of this post said Zendesk was an SMS customer of Nexmo. Though Zendesk is listed on Nexmo’s website as a customer, it uses Twilio for its SMS and push messaging services. Nexmo, however, has integrated its service with the Zendesk platform even though it has no direct business relationship with the company.

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Before you get too excited, Spreadtrum isn’t building the elusive Facebook Phone. Instead, it’s guaranteeing that millions of new phones sold into emerging markets will be “Facebook ready.”

Spreadtrum is pre-installing Facebook’s application software in its all-in-one Android smartphone platform – basically a smartphone-in-a-box containing the baseband and applications process, protocol stack, operating system and reference design. Spreadtrum’s customers — handset makers — can then use that platform to quickly produce inexpensive smartphones quickly and with minimal engineering and design investment.

Technically any Android phone user could simply download the Facebook app from Google Play (Facebook is often pre-installed on smartphones, in fact) but the Spreadtrum agreement ensures the software will be optimized for even the lowest end smartphones expected to make their way into countries like India. Facebook won’t have to deal with OS fragmentation on those devices, or worry about whether their hardware is capable of supporting its app’s features. Spreadtrum will work with Facebook to test app updates and new features to ensure they’ll work across the phones already in the market.

Also, having your app icon sitting front and center on a new phone’s home screen can’t hurt when introducing yourself to a new country.

“Working with Spreadtrum will extend Facebook’s reach in emerging markets, leveraging the rapid shift from feature phones to smartphones that is now taking place globally,” Facebook VP of mobile partnerships and corporate partnerships Vaughan Smith said in a statement.

Spreadtrum has already begun shipping its smartphone platform to Chinese handset vendors, building off the company’s expertise in the TD-SCDMA radio technologies unique to Chinese operators, but Facebook is officially banned in that country. On Wednesday, Spreadtrum revealed Facebook has given it and its handset partners permission to distribute its software outside of the Chinese market, opening up the possibility of millions of new Facebook-optimized devices in Latin America, Southeast Asia, Africa and India. Spreadtrum said it expects to ship 80 million to 100 million of those chipsets in 2013 alone.

Clarification: An early version of this post stated that Spreadtrum’s smartphone platform was shipping in China. While true, Facebook’s software is not included in any Spreadtrum-powered phone being sold in China itself due to a government ban. Rather phones manufactured in China but exported to overseas markets will carry the Facebook software.

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A large global growth fund could allow Sequoia to do larger deals as it expands its international presence. In May Dan Primack reported that the firm was looking to raise at least $1 billion in aggregate over several funds, and the firm reportedly raised $975 million for three early-stage venture funds this summer, the Wall Street Journal reported at the time. The firm has been expanding through those funds to areas like China and Israel for new investments, as well as expressing interest in Brazil.

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In two separate but reciprocal agreements, DoCoMo’s network of 55,000 hotspots will all become virtual nodes in Boingo’s Wi-Fi network. Before the deal, Boingo customers had access to only 5,000 hotspots in Japan. In turn, NTT DoCoMo customers will be able to roam onto Boingo’s global network, which now boasts 600,000 hotspots.

Boingo’s presence has expanded considerably in the last two years. It has announced similar roaming and offload deals with Korean carriers KT and LG U+ which together host 67,000 access points.

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Traveling to the United States from Canada (where I live) is bad enough, unless you have a special plan from your carrier that charges you only slightly more than the usual excessive rates. But going to Europe — which I did for GigaOM’s recent Structure: Europe conference in Amsterdam — makes even that look like a day at the beach. The typical carrier plan for international travel is almost ridiculously expensive for even trivial behavior, and if you want to make use of virtually any cloud-based services, even long-established ones like email or messaging, you will pay rates that make the old days of feudal servitude to the king seem like a vacation.

A monthly data package lasted less than an hour

To give just one example, I did what I thought I was supposed to do when I landed in Amsterdam: I bought a $50 “international data pack” from my carrier on my phone, a package that was supposed to include enough bandwidth to last me a month. I assumed this would be more than enough, because I was only going to be in Amsterdam for a week. In reality, I used the entire package in less than an hour — in fact, it wasn’t even enough to get me from the airport to my hotel, which is a half-hour trip. In that time, I checked email several times, looked at Google Maps to check my location (and find the hotel) and checked Twitter once.

In other words, I did things that any traveler might do. I didn’t download any HD movies or use my phone as a wireless hotspot or anything out of the ordinary. Based on that estimate, my week in Amsterdam could easily have cost me thousands of dollars, for something approaching my natural usage of cloud services. In fact, I actually wound up getting lost trying to find the hotel, in part because I was afraid to check Google Maps again. And so, telecom companies have succeeded in the kind of behavior modification usually done with animals: an electric shock is applied for any unwanted activity, to the point where you simply choose not do it.

In the end, I borrowed an unlocked phone from a friend (since my carrier doesn’t let me unlock my phone before the end of my contract without a penalty) and bought a local SIM card. That card gave me 15 times as much data as my own carrier did, for less than half the price. I should note that this is a provider I have been with for more than a decade, whom I pay monthly for a range of services including cable TV, broadband internet, five cellphones and a home VOIP service — and a complete stranger in an airport halfway around the world gave me 15 times the data for half the price my provider was prepared to.

And it’s not just me and my Canadian phone company. While at Structure, I spoke with a man who has been an advisor to some of the largest phone companies in the world, and he admitted that after his last trip abroad, he got a bill for more than 3,000 Euros — and he confessed that he had absolutely no idea what those charges were for. He had turned off all of his data-using apps, the ones which upload user information automatically to the cloud (Runkeeper, Apple’s Photostream, etc.) and tried to avoid doing anything like using maps. And yet, he was being asked to pay 20 times what a normal monthly cellphone plan would cost.

Market control results in economic rent

Why do we put up with this kind of thing? The simple answer is that we have no choice. In most cases, users get to choose between one or two — or possibly three — carriers, all of whom charge roughly the same for their services, especially for things like data roaming and text messaging. This is what is known as a cartel, or at the very least an oligopoly. And the reason why these companies charge thousands of times as much as it actually costs to transmit a megabyte of data is also simple: because they can.

Telecom carriers have lots of easy explanations for this kind of thing: foreign roaming agreements are expensive, they have to offset their investment in new technology, they need to subsidize handsets, and so on. But the reality is that they have virtually zero incentive to charge lower prices — they already control enough of the market to dictate terms. In order to provide cable and telephone service early on, many governments essentially gave carriers the future on a silver platter, and now there is no way around them. Like a feudal lord, the carriers served the king faithfully and now get to reap the benefits in perpetuity.

This is known as “economic rent” — meaning he who controls the market gets to set the rent. And in an age when web-based services have become such a huge part of our lives, there is an inevitable clash between our desire to use things like maps, email, text messaging and social networks and the carriers’ desire to continue making the kind of profit margins they have grown used to. And consumers are trapped in the middle.

Post and thumbnail images courtesy of Flickr user Alexander Vaughan

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Bloomberg, citing unnamed sources, reported that Sprint has no immediate plans to take over the remaining 52 percent of the 4G data carrier it doesn’t already own. The news sent Clearwire’s stock tumbling after several days of riding new highs on news of the Sprint-Softbank deal.

So why the fuss about Clearwire? The company has struggled mightily since its nationwide WiMAX rollout came to an abrupt halt in 2010 while the rest of the mobile industry threw its lot in with LTE. The company has since announced plans to deploy its own variant of LTE, called time-division or TD-LTE. Ostensibly that new network is going up right now, but Clearwire has been known to promise networks that fail to appear.

Clearwire needs both cash and customers to realize its network ambitions, and it might still be holding out hopes that a Softbank deal with Sprint is the key to both. In Softbank Clearwire has found a kindred soul. The carrier is pursuing its own TD-LTE build out in Japan, using the exact same 2.5 GHz band as Clearwire. The two are already partners in a global TD-LTE consortium – along with China Mobile and India’s Bharti – tasked with creating a handset and device ecosystem for their pet technology. A three-way marriage between Clearwire, Sprint and Softbank would only further those goals.

Sprint’s relationship with Clearwire has always been dictated by cash. But with an $8 billion cash infusion from Softbank, Sprint could buy out Clearwire outright and build the fattest LTE pipe in the country with Clearwire’s treasure trove of spectrum. That’s the theory anyway.

The thing is the so-called TD-LTE synergies of such a deal have been overstated. Buying and investing in Clearwire would definitely give TD-LTE a big boost and ensure that the technology had a place in the U.S., but that’s an awfully steep price to pay for what amounts to a vote of confidence. Softbank can build its device ecosystem just as easily by partnering with other carriers. And if the only way of keeping that global TD-LTE dream alive is to purchase struggling international operators, then Softbank may want to reconsider its technology choices.

Customers could roam between Japanese and U.S. TD-LTE networks, but a roaming agreement is hardly the basis for an acquisition. And while there might be device compatibility in TD-LTE, the remaining 2G, 3G and 4G networks and bands Softbank and Sprint-Clearwire use have absolutely nothing in common. It’s not like Sprint handsets are going to work on Softbank’s Japanese networks or vice versa – at least not until voice-over-LTE services are in full swing.

Softbank could feel there are other ways Sprint can use that cash to get the future capacity it needs, either by bidding in future 4G auctions or through other strategic acquisitions. Maybe Clearwire is ultimately part of Softbank’s U.S. ambitions, but it would be a mistake to assume that the two are natural fit just because they’re pursuing the same LTE technology.

Photo courtesy of Shutterstock user Gary Paul Lewis

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Coolpad may be a virtual unknown here, but in China it’s the No. 3 smartphone maker. Not only is Coolpad besting Apple’s iPhone, which ranks a woeful seventh, and Nokia; it’s even beating two of China’s hometown giants, Huawei and ZTE, according to IHS iSuppli.

Of course, Yulong has a long way to go before it can even dream of being that competitive in the U.S., but MetroPCS is a good place to start. The company is the largest regional operator in the country, and its focused on delivering cheap voice and data with no commitments (it recently started offering a promotional unlimited talk, text and data plan for $55 a month). But that also means that MetroPCS doesn’t offer the steep device discounts the major operators exchange for long-term contracts. To lure customers over to its new data services, MetroPCS needs cheap smartphones, which Yulong is prepared to deliver.

The Coolpad Quattro isn’t the Galaxy S III – which MetroPCS will also soon sell – but without subsidies it has a price tag that is $400 less than the Samsung phone. The Quattro runs Android 2.3 (Gingerbread), sports a 4-inch capacitive multi-touch screen and a 1 GHz single-core processor. It has both front and rear-facing cameras, the primary supporting 3.2 megapixels of resolution. It has 512 MB of RAM and a micro-SD slot that can take a 32 GB card.

The Coolpad Quattro and the LG Motion will be MetroPCS’s cheapest smartphones at $149 each, far undercutting its other 4G smartphones, which range from $229 and $459. Yulong is obviously crafting its U.S. strategy on selling budget devices. If it can continue to keep its prices this low it’s likely to attract attention from other operators.

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“Among all the international smartphone brands competing in China, Apple is the only one not offering a product that complies with the domestic TD-SCDMA air standard,” Wang said in a new IHS iSuppli’s report. “For Apple, this is a huge disadvantage, as TD-SCDMA represents the fastest-growing major air standard for smartphones in China, with shipments of compliant phones expected to rise by a factor of 10 from 2011 to 2016.”

He’s not wrong. By snubbing TD-SCDMA, Apple misses the opportunity to sell the iPhone through the country’s largest carrier China Mobile, and by “large” we’re talking scale unheard of in the U.S. or Europe. China Mobile is the world’s largest operator with 650 million connections – six times more than Verizon Wireless. While Apple counts the country’s No. 2 and No. 3 carriers, China Unicom and China Telecom as distributors, together they only serve 30 percent of the market. In other words, China Mobile is the big enchilada of the globe.

An Apple store in China.

So why doesn’t Apple take a bite? Adding TD-SCDMA support to the iPhone isn’t quite as simple as it sounds. As I’ve written before, adding a new radio technology to a phone isn’t just a matter of procuring the right Qualcomm chip, it requires power amplifiers, antennas and filters – all of which add expense, drain power and generally make a mess of the radio frequency characteristics of the device. Apple could do it, sure, but it would wind up with a crappier and costlier iPhone.

If Apple really wants to tackle China Mobile, it will need to come out with an iPhone variant for China, and so far Apple has been loath to do any such thing. Apple did build a CDMA iPhone for Verizon, but after the first generation of device, Apple once again unified its product line, embedding both CDMA and GSM radios in every phone. Plus, it didn’t take long before Apple started selling that device to other CDMA carriers globally.

Would Apple consider designing a “Chinese Special”? The answer is a big maybe.

China Mobile may be a big juicy target, but Apple’s strategy has always been to move markets rather than move with the market. It’s so far taken the attitude that if you want an iPhone in China, you should move to Unicom or Telecom. It took that same approach in the U.S. for years with AT&T. And it’s why some of the world’s other large carriers, T-Mobile USA and NTT DoCoMo for two, get snubbed.

But at some point Apple will have to start making iPhone variants whether it wants to or not. There’s a huge amount of fragmentation in the LTE bands used globally –there are six designated 4G bands in the U.S. alone – which will force Apple and other vendors to create region-specific and even carrier-specific devices (subscription required). The new iPad is just the first example: there are separate devices for AT&T and Verizon’s separate LTE networks.

If Apple has to start churning out variants anyway, it may figure it might as well make a Chinese iPhone, too.

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